Flexible spending account dental expenses can provide many tax savings opportunities for smart patients. Most treatments provided by your primary family dentist will most likely qualify.
Using your FSA to pay for unreimbursed dental work can lower your net costs. Pretax dollars help you reduce the amount of federal and state income taxes, plus FICA taxes.
Plan your annual contributions carefully. Eligible dental work expenses are often one of the largest and most predictable election choices. Learn what does and does not qualify.
FSA Eligible Dental Expenses
Flexible spending account eligible dental expenses are very broad. Any treatment designed to prevent or alleviate diseases of the mouth, teeth, and gums are included. Of course, only costs unreimbursed by your insurance plan qualify.
- Examples of eligible preventive services are cleanings, sealants, fluoride applications, and other treatments designed to minimize tooth decay.
- Examples of eligible treatments to alleviate existing disease include x-rays, fillings, extractions, dentures, and bridges.
Flexible spending accounts can work like a low-cost dental loan program with many advantages. Each plan year participants can elect to contribute up to $2,650. Time the oral care procedure to begin with the new FSA plan year.
Employers must reimburse all qualifying dental expenses immediately. The participant then has up to 52 weeks to repay the money using pre-tax payroll contributions. This reduces tax obligations in three possible ways.
- Federal income tax
- State income tax
- Payroll (FICA) tax
Dental financing programs are the second option to explore if you need to begin treatment right away.
You can use your flexible spending account to pay for braces. However, special rules apply. Make sure that you prequalify your orthodontia expenses before making an election each plan year.
You can claim expenses for braces only as your orthodontist renders treatment. On average, it takes about 18 months to straighten your teeth. However, the amount you pay may vary widely each month. You may pay a large upfront fee and monthly maintenance charges thereafter.
Dental crowns are flexible spending account eligible expenses. You must need the crown to restore function. The purpose cannot be to improve your appearance only. Make certain that your provider indicates such on any bill before you make payment.
Dental implants are also flexible spending account eligible expenses. The extraction and surgical procedure to install the posts are also included. As before, you must need the implants to restore proper biting and chewing function.
FSA loans can help you finance your implants. Time the procedure at the beginning of your plan year. You then have 52 weeks to repay the loan using pre-tax payroll contributions. In addition, since the cost of implants may exceed your annual contribution limit, you may need to spread treatments out over time, or pay for the remainder using after-tax dollars.
FSA Ineligible Dental Expenses
You cannot use your Flexible Spending Account for every single dental procedure. Your annual contribution limit will cap a number of eligible expenses. Once you reach the annual cap, you must pay using after-tax dollars. If your spouse has access to an FSA at his or her place of employment, you may be able to double the limit for your family.
In addition, you cannot claim cosmetic procedures and many over the counter supplies you use for proper oral hygiene on a daily basis. You must use after-tax dollars for these charges.
You cannot use your Flexible Spending Account for any cosmetic dental procedures. Cosmetic work improves the only appearance and does not prevent or treat an oral illness or disease.
Examples of cosmetic dental work that where you cannot use your FSA includes bonding, enamel microabrasion, labial veneers, occlusion adjustments, odontoblasts, and teeth whitening,
Over the Counter Supplies
You cannot use your Flexible Spending Account for over-the-counter dental supplies. For example, commonly purchased items that improve your oral hygiene do not qualify such as a toothbrush, or toothpaste.
The only exception to this rule may apply if your dentist writes a prescription to purchase and use specific devices. For example, a patient with periodontal disease may need an electric water pick flosser or a high-speed electric toothbrush.